Tag: Brexit

The Frenchman Jean Monnet, one of the founding fathers of today’s Europe, wrote that the process of European unity will “be accomplished in crises.”? The Brexit decision is a catastrophe for all Europeans. It is coming at a high price in political, social and economic terms.

But it is also a crisis that can make Europe significantly stronger – if politicians, especially in Germany, recognize and use … [continue reading]

Britain voted to leave the EU. This is terrible news for the UK, but it is also bad news for the Eurozone. Brexit opens the door to all sorts of shocks, and dangerous political snowball effects. Now is the time to shore up the Eurozone’s resiliency. The situation is not yet dire, but prompt action is needed. This VoxEU column – which is signed by a wide range of … [continue reading]

An important aspect, that has been widely ignored in the debate about the consequences of a Brexit, is the impact on ECB monetary policy. Lower oil prices and a weaker economy in the euro zone and in Germany are likely to increase deflationary pressures further. As a consequence, the ECB is likely to extend its expansionary monetary policy path further into the future. The Brexit will most likely imply a longer period of zero interest rates for the euro area.… [continue reading]

The Brexit decision is a catastrophe for all Europeans. The economic costs will be enormous for all of Europe. Britain could slide back into recession. We at DIW Belin expect a 0.5 percentage points lower economic growth in Germany in 2017 as a result of lower German exports to the UK alone. The risk is highest for countries such as Italy, which are vulnerable and could slide even deeper into the financial crisis.
I expect major volatility in financial markets … [continue reading]